Auditor-General Kimi Makwetu said on Wednesday that a new accountability tool introduced in April has so far brought to light irregular expenditure of R2.81 billion on the part of eight state entities. Photo: GCIS

PARLIAMENT – Auditor-General Kimi Makwetu said on Wednesday that a new accountability tool introduced in April has so far brought to light irregular expenditure of R2.81 billion on the part of eight state entities.

Makwetu said the bulk of that sum, R2.2 billion, was incurred by the Passenger Rail Association of SA (Prasa), confirming the reported losses the agency suffered as a result of irregularities in its purchase of new locomotives.

In total, 28 material misstatements were picked up in the accounts of the eight entities in question, following the amendment of the Public Audit Act to enable the Auditor-General to report on material irregularities and to allow direct action against accounting officers who fail to deal with these. This includes issuing a debt order against the accounting officer.

Makwetu said he foresaw that accounting officers would exercise greater prudence as the new rules meant that "if you don't, you might feel it in your own back pocket".

He has for years bemoaned the fact that there is little or no consequence for flouting proper accounting process in public entities, and therefore no incentive for accounting officers to stem the waste of public funds he reports on annually.

On Wednesday, he urged government leaders and legislatures to take urgent steps to halt what he termed "the trend of disappointing audit results", again evidenced in the figures for the 2018/19 financial year.

It showed that irregular expenditure increased to R62.60 billion from R51 billion in the previous financial year, and Makwetu cautioned that the sum might be higher had all relevant information been available to him.

"It is worth noting that the amount could be even higher, as 34 percent of the auditees were qualified because the amount disclosed was incomplete and/or that they had incurred irregular expenditure that the full amount was unknown."

He added that his office was unable to audit contracts worth a total of R2.33 billion because of incomplete information.